The cryptocurrency market may look like a spider’s web to the common man. And they may also be thinking that investors are wasting their hard money on something as unconventional as bitcoin. What has baffled governments across the world is that despite the unpredictability of bitcoin’s price cap, it continues to entrance crypto enthusiasts and investors. It has made and destroyed billionaires.
According to Grayscale’s Third Annual Bitcoin Investor Study, bitcoin seeps into the discussions of financial institutions, lawmakers, students, governments, investors, and the media alike. The report highlighted investors’ inclination to own a bitcoin as a long-term profitable investment, and not as a currency.
With its penetration into mainstream adoption, there is no turning back. Governments have acknowledged the fact that demand for bitcoin is tremendous. This is attributed to the digital asset’s ‘performance track record’. And this is consistent with the idea of bitcoin as a long-term investment. But then, this has been marked by its store-of-value which has been on the decline. In 2019, it was 54%, 46% in 2020, and just above 40% in 2021.
So what continues to light bitcoin’s chi? In July, this year bitcoin fell below $30,000 but on November 10, it hit an all-time high of a little over $68,000. Analysts predict it will skyrocket above the $100,000 mark in 2022. It’s just a matter of time. Some positive decisions taken by the administration, especially in the United States, and by Tesla CEO Elon Musk’s shift from Dogecoin to bitcoin will certainly do wonders! Furthermore, the report highlights that six out of 10 bitcoin investors have sold their digital assets and 91% have made profits.
But Theresa Morrison, a CEFP at Beckett Collective, believes cryptocurrency is a nascent industry. Her advice for investors is to not fall into a fool’s trap.